Recent trends in financing long-term care.

There has been dramatic change in the financing of long-term care in the last few years. Major private insurance carriers have introduced long-term care insurance policies to meet some of the custodial care needs of a variety of consumer groups, including old and young retirees as well as current employees. Newer policies are tying coverages more closely to a measure of disability that reflect the ability of persons to live independently. Insurers, consumer groups, and policymakers have come to understand the importance of developing innovative financing mechanisms that emphasize prefunding and cash accumulation to make policies more affordable and more desirable to a broader spectrum of the aged and nonaged population.